Real Estate 101: The Seller ALWAYS Pays More for the Buyer's Home Inspection!

Most Agents will tell you that the home inspection is usually a required contingency of most purchasing agreements, it is at the buyer's option and they are the ones paying for it.


Most buyers will opt for a home inspection—typically investing $300-$400 to get a comprehensive report of the home’s condition. Note that they are investing, not spending, this extremely small fraction of the cost of the home they have agreed to buy.

Why is the buyer's home inspection a low-risk investment and not the cost that I was told?

Every home has deferred maintenance issues, which the buyer's inspector is obliged to point out in their report. This means that their report will always include a list of defects that, if they deem significant enough, can potentially put the terms of the sale, or the entire agreement, at risk and ultimately force the relisting of the house. The seller, now presented with a repair or replacement "punch list" is forced into unpleasant renegotiation with the buyers and one or both Agents--ultimately having to do one of three things at this point: 1) agree to an offset or discount of the purchase price to cover the oft-times inflated costs of repairs; 2) agree to have negotiated items repaired or replaced at the seller's cost; or 3) do nothing and hope the deal doesn't fall through and force the relisting of the house. So, to recap, the buyer's small investment in a report has forced the seller to come back to the table and has provided the leverage needed to compel crisis concessions in their favor, or if the deal is cancelled, to back out--demanding the required return of their earnest money and moving on without penalties. In some cases involving buyer's remorse, this amounts to their "get out of deal free card."

Why is the seller paying and risking so much more than the buyer?

The terms of the agreement are time-bound--forcing any repairs or replacement to be done yesterday and usually by overqualified senior-level tradesmen when a general handyman or even the seller could effect the repairs. All repairs have to be "satisfactorily" repaired in order to stay on the closing timetable—typically, the combined costs of these repairs and replacements average $2,000!!! Not to mention the extra drama and stress of going through the whole rigmarole in the first place…Remember sellers, it is YOU, not your Agent, representing the material condition of your home. Failure to properly disclose defects is not only wrong, it’s a liability that could end up in an expensive lawsuit following closing, and “as is” is an extremely weak position to take in these cases—most wind up settling out of court. What better way to make a new start--searching and paying for an attorney to represent you in the city you just left…

The first one to get the home inspection wins!

So, the buyer invests $400 to get the seller to to spend thousands for the house they're getting. That's quite an ROI, and they haven't even gotten the keys yet! Of course, the seller could have avoided the extra hassle and expense by investing in their own prelisting home inspection, shopping around for the best value in making the repairs, and then enabling their Agent to use the report and repair invoice as a marketing advantage for their listing. It also helps to reduce the uncertainty that is a normal part of the transaction and gives the more impulsive and potentially unqualified buyers pause before they sign up for an agreement they may be unable to back out of. So, will you invest $400 for your integrity, a marketing advantage, and "deal insurance" or will you be forced to pay $2,000 or more in concessions or repair costs to salvage your deal and put and end to the emotionally draining negotiations?

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